R.I. moves to take over cash-strapped Central Coventry Fire District

The debt-ridden Central Coventry Fire District, facing a court-ordered May 16 liquidation deadline, may not go out of business after all, as Governor Chafee announced the state will take over, as it did in Central Falls, East Providence and Woonsocke

PROVIDENCE — The debt-ridden Central Coventry Fire District, facing a court-ordered May 16 liquidation deadline, may not go out of business after all, as Governor Chafee announced the state will take over, as it did in Central Falls, East Providence and Woonsocket.

“The state has been asked to step in,” Chafee wrote in letters to the leaders of the state House and Senate, “and will do so.”

The district was facing a court-ordered liquidation of its assets to pay its creditors by May 16, a week from Friday.

“It avoids the liquidation, which was imminent,” Richard J. Land, the state court-appointed special master who has been overseeing the district since October 2012, said of Chafee’s announcement.

Chafee is able to act because of a new law, passed Thursday, that adds local fire districts to the jurisdiction of the state Fiscal Stability Act. That law allows the Department of Revenue, in certain circumstances, to use increasing degrees of authority to take over a local government and reorganize its finances.

In the letters that informed the House and Senate that he signed the law, Chafee said it was “a last-ditch effort” to prevent the liquidation of the district.

Chafee spokeswoman Faye Zuckerman declined to say Monday whether the governor would chose to appoint a single receiver or a five-member budget commission comprising the president of the district board, the district fire chief and three members appointed by the Department of Revenue.

David Gorman, president of International Association of Firefighters Local 3372, which represents the district’s firefighters, said the union was pleased with the governor’s announcement.

“We’re kind of excited,” he said. “We think this is going to put us on the right path for resurrection.” He said the union was prepared to offer concessions to a commission or receiver that would be sufficient to fix the district’s budget.

District Board President Fred Gralinski, who has advocated letting the current district be liquidated so a new one with a different way of providing fire protection and emergency medical services could take its place, was circumspect.

“We’ll have to wait and see what the governor decides,” Gralinski said about what kind of takeover happens and what kind of reorganization it produces. “That’s going to be the governor’s call.”

Coventry Town Manager Thomas Hoover said the town didn’t want to see the Central Coventry district liquidated because of the effect it could have on public safety. The town has another concern: making sure the town is paid back the $300,000 it loaned the district last year.

Coventry doesn’t have a single townwide fire department; fire protection is provided by four independent districts. The Central Coventry Fire District covers 24 square miles. Its website claims 52 employees, 38 of them firefighters.

In a December 2012 breakdown of the district’s reeling finances, Land said the problem was in large part due to the district’s overestimation of its tax base by about $217 million in the 2011 and 2012 budget years, leading it to count on about $1.6 million in revenue that wasn’t coming. The problem was made worse by about $2 million more in overspending in the years before 2012.